Even Wall Street Says Tesla's Day Of Reckoning Is Near

By David Stockman. Posted On Saturday, March 31st, 2018

The company's shares declined 22 percent in March on concerns over a fatal car crash in California last week and worries over its Model 3 production rate. Tesla's 5.3 percent bond, issued last August and maturing in 2025, also fell 4 percent to 87.25 cents Wednesday with a yield of 7.6 percent, according to FactSet. The bond's price declined 8 percent this month.

Morgan Stanley on Wednesday warned Tesla shareholders the stock's fall could be a "self-fulfilling" prophecy for further declines. "A lower share price begets a lower share price … For a company widely expected to continue to fund its strategy through external capital raises, a fall in the share price can take on a self-fulfilling nature that further exacerbates the volatility of the share price," analyst Adam Jonas wrote.

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